Opening a liquor store can be an exciting business venture, but creating your liquor store's business plan shouldn't be an afterthought.
The liquor industry can be an incredibly lucrative business opportunity, but only if you tackle it with a well-thought-out strategy and business plan. There are 40,612 liquor stores in America, so it's essential to put in the time to research the market so you can compete with established stores.
With over 20 years in the liquor industry, we're always happy to lend our expertise and knowledge to aspiring liquor store owners. If you're contemplating venturing into the liquor industry, here are six do’s and don'ts you should consider when creating your business plan.
Creating a Liquor Store Business Plan 101
A liquor store business can be an incredibly exciting and prosperous investment opportunity. With a clear and definitive business plan, you can avoid missing essential factors or critical considerations in opening your store.
A liquor store business plan will help you prepare for the challenges of operating your business and set you up for success in growing your store. Your business plan should provide an overview of your liquor store and a three- or five-year plan.
It should also serve as a checklist to ensure you're getting all the proper licenses, technology, and resources to operate your business on a day-to-day basis.
Not all business plans are made equal, and there are a few do’s and don'ts when creating your plan.
1. Don't Forget to Include Insurance In Your Business Plan
Every business requires insurance. Insurance protects all stakeholders involved with your business in the event of injury, theft, natural disaster, or sickness.
With any operation, there is always some physical risk or opportunity for injury, and it's important to have liability insurance in case any accidents occur in the workplace.
Your store can also be subject to crimes like robbery, fraud, theft, and embezzlement. If you don't have coverage, you'll be bleeding money and paying out of pocket to correct any damages.
Property damage can come from theft, but it can also come from environmental factors, depending on where you live. It's essential to get coverage in case of things like floods, earthquakes, or any natural disaster.
Cyber attacks should also be considered, given the digital age we live in. They happen fast and under the radar, and you could face serious setbacks without coverage.
Temporary closure due to health issues or any emergency that leads to loss of income or revenue for the store can be a huge concern. It's important to get the right kind of insurance to protect yourself in any emergency.
Forgetting to cover all your bases when it comes to insurance leaves you with many risks, and you should only operate a business with all things covered.
2. Don't Start Your Business Plan Without Research
Your research should include all opening and construction costs, operational costs, and potential profit margins. Liquor stores require a good amount of cash upfront, so you need to understand the size of your investment and line up financing to make it happen.
You also need to consider what products you'll offer. Some staples are basically required for every liquor store: big-name beer and wine brands, the most popular whisky, vodka, and the mixers to go with them.
But there are also hundreds of different products that different segments of customers will purchase. From rare liquors and craft beer to seltzers and ready-to-drink (RTD) beverages, you’ll need to study up.
You won't become an expert overnight, but knowing your products can help you figure out how to sell them.
This is why a solution like Bottle POS is a great option for new liquor store business owners, as a pre-populated liquor database can make it easy for any new owner to fill their inventory with popular products. Bottle POS’ centralized database makes it easy to manage stock and helps you select products that are most likely to sell.
3. Do Develop A Financial Plan
Once you've done substantial research, it's time to start documenting costs and developing a financial plan. You'll need to consider inventory, equipment, rent, building maintenance, security, and all the permit costs necessary for legal operation.
Besides labor costs and operational expenditures, inventory is one of the most significant financial considerations.
How much do you order, what should you order, and how often should you order?
Your POS system should give you insight into sales and inventory data for reordering. If your POS system has automatic restocking and autonomous receiving for inventory, you can save time and money and simplify an otherwise timely process.
Your POS insights will help you quickly identify the brands that drive your sales and the overstocked products that cost you. Think of it as the guide, partner, or sidekick to your store.
4. Don't Be Consumed By Day-To-Day Operations
Your day-to-day operations include ordering alcohol, unloading deliveries, labeling liquor bottles, and accounting for any shrinkage.
The right POS system can help you optimize your day-to-day processes, so you spend less time processing and more time automating your functions. Invoicing can take tons of time. With automation, you can save hours on manual data entry every week.
There are so many things to account for, and working with a modern liquor store POS system can help optimize your store's efficiency.
5. Do Spend Time on Choosing the Right POS System
A cloud-based liquor POS system can take your liquor store business to the next level.
Using a secure network, you can access all the data surrounding your inventory management from a simplified user interface in the comfort of your own space, or on location.
A cloud-based POS system will help you quickly identify which brands drive your sales and which are overstocked or dead stock.
This can help you determine what products to bring in and what to avoid.
Sales trends can also show you when people buy the most product, and other data points to help you develop promotional campaigns or sales. With the right POS system, you can see important data to guide your business decisions.
With key sales and product data, you can create forecasts and document revenue trends, ultimately enabling you to plan and create long-term goals designed to see your business grow.
A Liquor Store Business Plan Designed For Success
Opening a liquor store starts with creating a solid business plan, but putting together a business plan is more complex than just documenting the steps you need to take before you can open your doors.
It's important to consider things like liquor licenses, business insurance, and other operational necessities that ensure you run your business compliantly and with protection.
On top of that, it's important to conduct market research, become a product expert, and consider your day-to-day operations before and after you open. Regularly analyzing store data and revenue trends are key to developing long-term goals and growth plans.
Many factors go into creating a business plan to set you and your store up for success, and it's easy to miss or overlook something important. However, the right POS system can make your job significantly easier.
Inventory management, databases, stock replenishment, secure technology, robust data analysis, and reporting are just a few ways a point of sale system like Bottle POS can help optimize your processes so you can focus on your customers and grow your business.
If you're ready to venture into the liquor industry and want to work with a POS system that can help take your business off the ground, get in touch with our team.
